The evolution of corporate governance in Brazil

Bernard Black*, Antonio Gledson de Carvalho, Joelson Oliveira Sampaio

*Corresponding author for this work

    Research output: Contribution to journalArticlepeer-review

    33 Scopus citations


    We use extensive hand collected surveys reporting governance practices of Brazilian firms in 2004, 2006, and 2009 to build a broad corporate governance index and analyze the evolution of corporate governance in Brazil and the association between governance and firm value. We find that corporate governance practices improved significantly over this period. This evolution is due to two main factors: 1) growth in Novo Mercado and Level II (NM&L2) listings, mainly through IPOs by new firms, and 2) improved practices at non-NM&L2 firms, principally through adopting governance elements required for NM&L2 listing. Governance practices for firms already listed on NM&L2 were stable. Adoption of the elements of our governance index that are required for NM&L2 listing predicts higher firm value. In contrast, adoption of the remaining elements of our index does not predict firm value. Thus, governance changes appear to respond to investor preferences.

    Original languageEnglish (US)
    Pages (from-to)176-195
    Number of pages20
    JournalEmerging Markets Review
    StatePublished - Sep 1 2014


    • Boards of directors
    • Brazil
    • Corporate governance
    • Minority shareholders

    ASJC Scopus subject areas

    • Business and International Management
    • Economics and Econometrics

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